Move over IT, biotech's got its own parks too

TNNSep 1, 2004, 12.31AM IST

On the lines of the IT industry's conquest of the global market made possible through the timely software technology parks, the government has crafted a similar formula for sunrise sector, biotechnology.

The Foreign Trade Policy '04-09 makes room for setting up of biotechnology parks across the country. The policy decision based on a Department of Biotechnology (DBT) recommendation envisages all facilities available to 100% EOUs to be extended to biotech companies located in these parks. Gradually the sops will be fashioned in such manner as to bring BT at par with IT.

Kiran Mazumdar Shaw, chairwoman and MD, Biocon India says, "I think this is a very good policy move and will give a big boost for research companies. Biotech companies, which are largely research-oriented need to have affordable infrastructure. BT Parks with an EOU-like scheme make this possible."

India's nascent biotechnology industry is expected to generate a whopping $5bn in revenues and create over one million jobs in the next five years, according to the Ernst & Young '04 Global Biotechnology Report. Companies which are setting up wholly-owned subsidiaries —especially in the pharma R&D space, following the incentives announced in the Budget —will hence benefit from this policy while procuring raw material, machinery and so on.

"I think it is a positive move to give biotech parks an EOU status, but this will take a long gestation period for the benefits to reach biotech companies," said Habil Khorakiwala, chairman and managing director, Wockhardt.

The Policy says the biotech parks will be notified by the DGFT on the recommendations of the DBT. Once the larger framework is in place, it will be the DBT which will give necessary approvals and permission under relevant provisions of Chapter 6 of the Foreign Trade Policy.

DBT sources told ET that originally an SEZ -model had been envisaged —however since a tailor-made system is not in place for the new sector, it was felt that the customs and revenue departments may not be able to apply existing procedures to the biotechnology sector.

The biotechnology sector can be broadly categorised into pharmaceutical, agricultural, pesticidal, medicinal, diagnostic, recombinant, enzyme, protein and so on. "We would like to approve only those activities with high throughput and tech-intensive methods. That will encompass all modern biotechnologies," sources said. The problem that could surface —which may demand expert DBT clearance —will be that of traditional grandma-like biotech solutions based on fermentation and the like.

DBT officials have already provided the DGFT with broad outline of the industry, the R&D units, organisations, products and activities that could be termed 'biotechnology'.

Biotechnology Parks are already coming up in the country under various other initiatives such as the joint venture of Shaporji Pallonji with the Andhra Pradesh government in Hyderbad and the DBT project in Lucknow.

Two projects are on in Maharashtra too — Biopharma Park at Hinjawadi, Pune and Bioagri Park at Jalna near Aurangabad.